The main weight on the euro is presently not economic but political. Recent developments in France underscore our argument that the success of the populist-nationalist forces requires some sort of help from the mainstream parties. This was clearly the case in the US and UK, where no populist party was elected, but instead, the populist agenda co-opted by the center-right. The non-binding UK referendum turned into a binding decision with the smallest of majorities for such an important change. It has yet to be seen how President Trump relates with the Republican Party. However, it is strikingly different that what the Democrat leadership did in 1972. Then the left-wing of the Democrat Party succeeded in nominating McGovern, and the leadership of the party abandoned him, helping to produce a landslide victory for Nixon.
Russian economic minister out on the wires 17 Feb
- rouble is expected to weaken somewhat in near future and then stabilise
- CB to stick to floating exchange rate
- discussions at meeting with Putin inc ccy market
Rouble weakening as I type.
Hey Donald, there’s another ccy manipulator to add to your list.
People’s Bank of China OMOs for today:
- To inject 30 bn yuan through 7-day reverse repos
- To inject 40 bn yuan through 14-day reverse repos
- To inject 60 bn yuan through 28-day reverse repos
The rouble had already been appreciating as oil prices have recovered over the last twelve months, and growing optimism since Donald Trump’s victory in the US election has helped it become the best-performing emerging market currency since the vote, up just shy of 10 per cent.
President Trump’s calls for a normalisation of relations with Russia raised hopes of a relaxation of economic sanctions and encouraged international investors to return to the country.
However, economists have been sceptical the bank would be able to have a big impact on the currency, and it has continued to rise a further 1.6 per cent since the announcement, including a 0.5 per cent rise this morning to take it to 57.99 per dollar.